1. Field of the Disclosure
The present disclosure relates to an evaluation of data relating to a credit worthiness of an entity, and, more particularly, to producing data that provides detailed trade payment experience about the entity which is classified, stored and meta-data tagged, as well as combined with event-drive enhancements of relevancy statistics, and thereafter put through a novel customer specific evaluation process.
2. Description of the Related Art
An entity is a legal entity (e.g., an individual, a partnership or a company) that conducts business or purports to conduct business. A trade experience is a record of a transaction between a supplier and a purchaser including, but not limited to, terms of sales, credit allowance, age of open balances, payment details and account information concerning an experience of an entity, involving the entity's payment for a good or service provided to the entity.
Traditionally, a payment index (PAYDEX™) score, which is a credit information service that rates payment performance, was calculated for all trade experiences. The score was a weighted average of how fast or slow a company paid others. The company may have a good score, yet pay some parties on time and others late. For example, a company may pay parties with big relationships one way and those with small relationships another way.
Customer feedback indicated that they wanted more data used in the calculation; they wanted the data to be fresher, and they wanted the data to be more relevant to them in particular. The customer experience was that some customers behaved just like the score and others did not and they did not know why. Customers indicated that certain types of trade experience and history had higher importance than other trades. There is a need for a payment performance score segmented by industry, size of the business, age of the business and payment ranges that is more predictive of how a company will pay a particular party.
One such credit report which depicts trade experiences is disclosed in U.S. Patent Publication No. 2005/0240503, which is incorporated herein in its entirety, and wherein a payment performance score is calculated for particular industries, payment ranges, and time sensitivity periods, such as 3, 6, 9, and 12 month calculations. The score is predictive of how a company will pay a particular party. The score is based on trade experiences and is provided in a report.
FIGS. 4 and 5 depict a conventional detail trade process with invoice level detail 300, supplier provided account level trade detail 302 and summary elements 304 (e.g., date of experience, payment record, high credit, now owes, past due, selling terms and date of last sale). FIG. 5 shows a conventional trade payment experience report which summarizes payment experiences during normal market conditions so as to provide a quick snapshot for decisioning under normal market conditions. This summarization has its limitations, i.e., (a) it only captures 12 months of history in a single “payment experience”, making it difficult to do sensitivity analyses based on payment dates, and (b) it masks visibility into payment behavior trends, taking longer for prompt and slow-pay behavior to become evident. The disadvantage of the prior art detail trade reporting is that it restricts the visibility the customers want and need in volatile market conditions.
However, none of the current credit reports provide enough current and relevant trade experiences to enable companies to make informed creditworthiness decisions, especially in today's rapidly changing economic environment. The present disclosure provides for the generation of credit reports that are much more current and accurate regarding a company's creditworthiness, thereby avoiding the use of obsolete data in making such decisions. In addition, the present disclosure provides the ability for unique trade data aggregation, synthesis and relevancy processing of data, and application of customer specific evaluation processing.